Musk’s $1t Pay Package Is Full Of Watered-down Versions Of His Own Broken Promises

Tesla has projected a monolithic caller $1 trillion compensation package for its CEO Elon Musk, and galore of nan benchmarks he needs to deed are simply watered-down versions of promises he’s spent years making astir nan company.

That’s not nan image Tesla’s committee of board paints successful nan company’s annual proxy statement, wherever they revealed nan projected salary package. Instead, nan committee focuses connected really it plans to create “the astir valuable institution successful history.”

To beryllium sure, if Tesla accomplishes each that it intends for pinch this deal, it will look for illustration a overmuch different institution astatine nan extremity of nan 10-year play it covers. That doesn’t alteration nan truth that nan milestones nan institution is asking Musk to purpose for are little eager than his ain previously-stated goals.

While nan unprecedented salary package still needs to beryllium approved by shareholders astatine a gathering successful November, it’s easy to spot nan company’s fervent instrumentality guidelines voting “yes.” Previous votes connected Musk’s compensation person been overwhelmingly approved by Tesla’s shareholders.

With that successful mind, let’s return a look astatine what Musk needs to execute successful bid to person nan afloat payout.

defaultImage Credits:Justin Sullivan / Getty Images

20 cardinal cars … total

Musk spent years claiming Tesla would beryllium capable to make 20 cardinal electrical vehicles per year by 2030. This was backmost erstwhile he and his institution were still promising to turn astatine a complaint of 50% each year.

But Tesla walked distant from those promises arsenic income maturation stalled, and past reversed successful 2024. The institution past pulled nan 20-million-per-year extremity from its effect study last year, and stopped building a planned mill successful Mexico that would person accrued production.

Now, nan first “product goal” that Tesla’s committee of board laid retired for Musk to execute connected his way to becoming a trillionaire is to present 20 cardinal vehicles total. Tesla has already sold 8 cardinal cars to date, and moreover pinch income slumping, is moving conscionable awkward of 2 cardinal per year.

With nan caller salary package being laid retired complete a 10-year period, that intends nan target has gone from 20 cardinal EVs per twelvemonth by 2030 to conscionable 20 cardinal full by 2035.

A Tesla Cybercab prototype astatine a Tesla shop successful San Jose, California, US, connected Tuesday, Nov. 12, 2024. Tesla CEO Elon Musk said nan robotaxi, which has nary steering instrumentality aliases pedals, could costs little than $30,000 and “probably” will spell into accumulation successful 2026. Photographer: David Paul Morris/BloombergImage Credits:David Paul Morris/Bloomberg / Getty Images

One cardinal robotaxis*

One of Musk’s astir infamous and outrageous promises astir Tesla came successful 2019, erstwhile he claimed that nan institution would person one cardinal robotaxis connected nan roadworthy successful 2020. It’s now 2025, and Tesla has only conscionable begun to proceedings a robotaxi work successful Austin, Texas that has, astatine most, astir 20 aliases 30 cars with information drivers connected board.

To entree his afloat projected salary package, Tesla is asking Musk to thief nan institution recognize an altered type of that promise, arsenic different merchandise extremity listed is to person “1 cardinal Robotaxis successful Commercial Operation.”

It’s a extremity pinch caveats. The good people shows that Tesla is only requiring location to beryllium a “daily mean aggregate” of 1 cardinal robotaxis “commercially operated by aliases connected behalf of [Tesla] complete a consecutive three-month period, arsenic portion of a proscription service.”

Tesla goes connected to specify “Robotaxi” arsenic immoderate Tesla vehicle, including but not constricted to nan purpose-built “Cybercab” it’s developing, that is utilizing nan company’s Full Self-Driving package to connection rides to people.

This includes customer-owned vehicles, which is different point Musk has agelong promised but ne'er delivered. He’s spent years claiming that Tesla could flip a integer move and move existing vehicles into fully-autonomous ones, and that owners could adhd and subtract those vehicles to a larger robotaxi fleet astatine will.

But Musk has since said many of nan Teslas presently connected nan roadworthy don’t person nan basal hardware for nan erstwhile to happen, and nan institution has yet to show nan latter. Regardless, Musk now has an moreover looser timeline to effort and make some things happen.

Image: TeslaImage Credits:Tesla

One cardinal “bots”?

Musk sees Tesla’s early being each astir nan humanoid robot that it’s developing, called Optimus. Just this week he claimed it could dress up arsenic overmuch arsenic 80% of nan company’s early revenue.

As he became progressively focused connected Optimus, Musk made immoderate beautiful chaotic promises astir what that early would look like. One of his halfway claims was that Tesla will beryllium making 1 cardinal Optimus bots per year by as early arsenic 2029.

And yet, Tesla’s committee is only asking Musk to present 1 cardinal “bots” full arsenic portion of this projected compensation plan. Tesla besides defines “bots” arsenic “any robot aliases different beingness merchandise pinch mobility utilizing artificial intelligence manufactured by aliases connected behalf of nan Company” — though nan company’s vehicles do not count.

The board look to work together that Optimus has “the imaginable to beryllium Tesla’s bestselling product,” and they opportunity it reperesents “the clearest illustration of really Tesla has nan expertise to make autonomy use each of humanity.”

But nan committee besides notes that “commercialization plans” for Optimus are “still successful development,” and Musk now has until 2035 to scope nan 1 cardinal mark.

Image Credits:Tesla India / X

Everything else

The 4th and last merchandise extremity Musk has to execute is to notch 10 cardinal progressive subscriptions to Tesla’s Full Self-Driving (FSD) software. It’s arguably nan astir eager merchandise goal. The institution does not opportunity really galore existent owners person paid for FSD, though executives person precocious said the take rate is successful nan “teens.” At best, that intends anyplace from a fewer 100 1000 to nan debased millions of Tesla vehicles person nan package installed.

Everything other Tesla’s committee is asking of Musk is tied to money. Ultimately, Musk needs to thief Tesla scope an $8.5 trillion valuation successful bid to unlock nan afloat worth of nan compensation package and go a trillionaire himself.

Musk already had expansive designs to execute thing similar. He has often claimed that Tesla could 1 time go much valuable than Apple and Saudi Aramco combined. At their existent valuations, those 2 companies are collectively worthy astir $5.5 trillion. But earlier this year, nan CEO claimed Tesla could beryllium worthy much than nan next 5 most-valuable companies combined — which astatine nan clip meant he was aiming person to nan $15 trillion mark.

Along pinch nan extremity of blowing up Tesla’s valuation, Musk is being asked to summation nan company’s net to, essentially, $400 cardinal per twelvemonth — an tremendous fig compared to past year’s net of astir $17 billion.

Lastly, Tesla’s committee has asked for 2 notable assurances from Musk successful bid to unlock nan afloat worth of nan compensation package. One is that he must activity pinch nan institution to create a scheme for really he will beryllium succeeded arsenic CEO of Tesla (and nan scheme fundamentally locks him to nan institution for astatine slightest 7.5 years).

The other, buried successful a footnote, is that Tesla received “assurances that Musk’s engagement pinch nan governmental sphere would upwind down successful a timely manner.”

Taken arsenic a whole, it’s a analyzable statement pinch tons of genuinely pie-in-the-sky ideas astir wherever Tesla could spell nether Musk’s activity complete nan adjacent decade. The aforesaid was said astir nan erstwhile compensation woody that Tesla struck pinch Musk back successful 2018, and yet nan institution deed each of those seemingly-outrageous goals. (Musk’s grant was yet dusted by Delaware’s Chancery Court.)

Still, it’s difficult not to announcement conscionable really overmuch these caller goals look to travel from nan institution trying to resistance its CEO’s promises backmost down to Earth.